live from bloomberg world headquarters in new york from the next hour and we are covering stories in san francisco, greece, and japan. stocks are pulling back in the final hour of trading could financials and energy lead the declines today, while earning season causes of these stocks to breakout. vonnie: the people of japan are preparing to head for the hills for the mountain day holiday. retailers and tourism operators are gearing up for a windfall, any billion-dollar windfall. reportingke shack is earnings after the hour. the company has installed since its idea. we will get the state of the restaurant industry. an hour from the close of trading, let's go to the markets desk, where julie hyman has the latest. we are still in the red.

then earlier.so this is a trend we have been seeing as we get into august here. you see the nasdaq down .5%. as it be at the lows of the session as well as the dow falls by 58 points today. i want to get to the highlights of what has been moving today. oil has been on the list. oil prices are plunging after we got the weekly inventory numbers showing an unexpected build in inventories. ago, $41.53. down by nearly 3%. putting pressure on energy stocks. in terms of earnings numbers we have gotten, tale of two retailers between ralph lauren and kors. kors beat estimates but did not raises forecast. that is causing some concern. ralph lauren beating with its

numbers and stoking hopes of a turnaround taking hold under the new ceo. we are watching yelp as well. often and sales beating strength of ade revenue and a number of different analysts at places like raymond james are raising the rating on the stock as a result as it climbs by 13%. then we are watching an acquisition that may be running into trouble. kla'stalking about acquisition, $10.6 billion deal. the 2 had planned to close on this in october but lam says it is facing regulatory hurdles and will not get approval before closing in october. lam down five presented these are two of the largest makers of chipmaking equipment. we saw a similar acquisition got blocked last year. shery: julie, we are seeing very

strong reaction after the successful 10-year auction. julie: very successful 10-year option. demand for treasuries continues apace. you see the treasury yields going down from 1.5, 1% today. buying in the treasury market. there was an option of 10 year notes and it drew the lowest yield we have seen in four years. it implies the highest demand. interesting we're seeing the strong demand for treasuries as they can be with sovereign debt around the world, negative yields. even 1.5% looks lofty by comparison. vonnie: never thought we would be saying that. julie, thank you. let's get a check of the headlines. mark crumpton has more. mark: a new poll on the presidential race in wisconsin. on marquette university sudeten shows hillary clinton with 52% of likely voters and donald trump with 37%.

in a former contest, clinton is 47%, trump 34, libertarian gary johnson has 10% from the green party's jill stein has the support of 4% of likely voters. mrs. clinton has retained most of the bounce she received from the democratic convention. the bloomberg politics national survey shows her leading trump 50%-40 4% among likely voters. when third-party candidates are included, mrs. clinton's lead chance to close to the margin of error. 17 people are dead and 40 injured after 2 buses collided head-on near the pacific coast of peru. took place in a province south of capital lima. theian president putin says move by ukraine special forces to carry out what he calls subversion actions was criminal, stupid, and an attempt by ukraine to distract its people from economic problems.

football fans who traveled to canton, ohio, for the hall of fame game last weekend plan to sue the national football league. the game was canceled sunday night because of poor field conditions. the associated press says at least 20 people have approached an attorney about filing a class action lawsuit. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. vonnie: mark, thanks. let's turn to the market stocks today dropping from record highs . and next guest has a positive outlook on u.s. equities. joining us is jeremy zirin, chief equity strategist at ubs wealth management. why the positive outlook, fundamentals or momentum? both but little bit of mostly fundamental state if you look back over the past couple of months we see economic momentum was stronger than people thought before the u.k. referendum and the impact of the

u.k. referendum certainly has not had a dramatic impact on the near-term positive economic data flow. in the u.s. we have seen the labor market picked up and most importantly, versus outlook for u.s. equities can we have seen second-quarter earnings came in less bad than the first quarter. it seems clear at this point of the first quarter was the trough in year one year s&p 500 earnings and not only is the second quarter earnings coming in a bit better than expectations and the down 6% in the first quarter, but it does indicate that the momentum has shifted in the earning cycle and we are likely to see positive earnings growth in the second half of the year. shery: how are stocks doing compared to government bonds? this data from bank of america merrill lynch, showing 64% of stocks in the s&p 500 -- if we can get the chart they have dividend yields that exceed the 10-year ca treasury note in yields last month. how good are stocks as sources of income? jeremy: i think that is one of

the driving forces behind the equity market rally and one of the reasons we still like equities here. in part we think there is absolutely returns going forward, although moderate. probably in the mid-single digits the next 12 months. the hurdle for stocks to outperform bonds is quite low given the low interest rates you just mentioned. stocks are increasingly being used as income vehicles relative to history, where historically over the last six years or so, bond yields are about 300 basis points higher than the s&p 500. today that is on its head. they are about 50 basis points higher than the 10 year treasury. vonnie: let's step into my terminal because i want to look at a chart. value versus growth. performance by value is not massive but there is still a decent outperformance. where would your preferences lie for the rest of the year? jeremy: we are fairly agnostic

comes to the u.s. equity market. we have a neutral allocation between growth and value. right, it comes after a performance by 10 points last year after the last decade, growth has outperformed a value by quite a wide margin. the drivers for value and for the value cycle to be sustained is largely driven by two things. one, we need higher interest rates. the value index is dominated by the financial sector. two, one of the biggest driver of why the value has improved this year is the rebound we have seen in oil prices and energy stocks. financials and energy tend to dominate the value segment. sentencehe growthiest of the market they did so well lester, whether it be biotech, internet software, have not done quite as well this year and that has caused some of this rotation into value this year. you should have a fairly diversified portfolio because it

is very unclear going forward whether we are going to see sustain higher interest rate level that would allow financials to perform better, which was really a prerequisite for value investments to do better in the long term. shery: exactly, you said it. even today bankshares are sinking on speculation that rates will stay low for longer. will they be able to catch up to the broader market at some point? jeremy: our view is that it is a tough call. interest rates will stay low for longer. we have put in the lows for the 10 year treasury this year when we dipped below 140. that does not mean we are off to the races. core inflation is running at 1.6%. we are seeing a little bit of tightening in the labor markets. we are seeing strong wage pressures started bill. probably not enough for the fed to move in the next couple of months. the more likely scenario for the rest of the years that the fed waits until december to move and .aise rates by 25 basis points

in that scenario we are probably going to see rain check and range-boundasuryr-- treasury yields. on a great profit environment for the financial sector. balancedit is a pretty risk reward for financial went forward. vonnie: what is the number one complaint or concern from clients of ebs right now? jeremy: i'm sorry? vonnie: what is the number one concern from clients of ebs right now? presidential election, federal reserve? jeremy: anxiety level is probably the most acute around the election. our view is that one shouldn't formulate their asset allocation around their political views around the election outcome. big gap between what politicians are saying right now in terms of the rhetoric and what policies will become law in 2017 and beyond. in our view there is not going to be a huge difference in our thinking, right now at least, in

terms of what is -- regardless of the outcome of the election, the bottom line for the economy and for the profit cycle is probably less impacted than perceived by many investors. shery: jeremy, great to talk to you. jeremy zeron of ubs wealth management. coming up in the next 20 minutes, japan is launching a new holiday tomorrow with the hopes of bringing in billions of the tourism and retail industry. we will discuss the high hopes behind mt. -- mountain day. vonnie: shake shack reports earnings after the bell. a preview and insight on americans eating habits. that is coming up. out my donald trump, he is in virginia, where he is holding a rally. this is after he met with coal miners and industry employees. you can watch the full event on the bloomberg.

this is bloomberg. ♪

shery: live from our world headquarters in new york, this is "bloomberg markets." i am shery ahn. vonnie: i am vonnie quinn. beautiful new york city skyline. time for the biggest business stories in the news right now. apple is planning the first prohaul of its macbook laptop in four years, according to people familiar with the matter. apple is hoping a revamp will boost sales after orders of declines. the updated notebook will be

slimmer and have more powerful graphics processors for videogamers. shery: ralph lauren posted quarterly earnings that beat estimates. the new ceo is tried to turn around the company by closing stores and cutting 1000 jobs and hiring new executive. ralph lauren's profits have a fall in the last two years. vonnie: wendy's is the latest major fast food chain to report weaker than expected sales growth. the hamburger company says the barn on dining out as much because it has gotten even cheaper to eat at home. sales edged up .4%. that is your bloomberg business flash update. shery: now to japan, where it is already very early thursday morning, which means the inaugural mountain day holiday has begun. folks will be heading for the hills and retailers and tour operators will be hoping for a big surge in spending. betty liu joins us now with this story. betty, i lived in japan for five

years. very generous when it comes to public holidays. how did this one, about? betty: another one, right? you live there, you tell me. the japanese work so hard that they are forced to take a holiday, otherwise they are not going to. shery: lots of people capping the amount of hours you work today. betty: they are forced to -- not forced, but encouraged to take a break. mountain day, what does that mean? you put on your camping here and hike mountains like mount fuji. i think it is fascinating that there are different holidays, and we have thanksgiving where we stuff are faced. greenery day, green day, coming-of-age day -- i guess you come of age. vonnie: wouldn't it be better with more of an open society and immigration and you may not have to work as hard? betty: that is a key issue.

let me get to the economics of it. why do we had bloomberg care about this? in terms of mountain day, there is the idea that it is not only going to encourage people to get are in our but he could also mean a boom for the economy. some analysts say this could mean up to $8 billion worth of spending and economic value country, because people will be buying things, spending money on these trips. at is the economic data that is the economic underpinning to that. point about why do they work so hard because of the tight labor force them there is a very tight labor force. the jobless rate in japan is now at 21-year low. some are saying that because abenomics work so well, but because there are so many old people and people are getting older and older and they cannot work anymore. you don't have enough supply. shery: when you don't see wages

actually increasing, it makes you think, doesn't it? how is this demographic affecting japan? betty: most clearly you can see that in the labor numbers. that is absolutely occurring. but it also means that wage growth is going to get tighter, and also, it will put more pressure on some of these policy onnie, youe, v are saying, opening up the employment system in the country to get more of a diverse workforce. it also means a demographic shift of more women in the workforce. shery: which was a key priority for abe. betty: exactly. for so long in japan, women were not a big part of the workforce. but if you don't have enough labor out there, you will have to look to open up your policies more to women. vonnie: i have to say, i love that there was a poll that found that a third of the calculation

-- betty: i love that. vonnie: didn't realize the holiday was coming up. betty: this is the first time they are doing mountain day. they passed this through parliament. yes, according to a poll, about one third of the people in japan had no idea this holiday even existed. it is like christmas. you wake up and you were like, oh, i don't have to go to work. this is fantastic. vonnie: looking at that in new york. is a we realize there friday or monday -- betty: we should make up our holidays and call our local congresspeople. vonnie: thanks to "bloomberg daybreak asia" anchor betty liu. still ahead on "bloomberg markets," strong recovery since february lows and trades in the space in the options inside. and we continue to monitor this donald trump event.

he is in virginia, where he is holding a rally, this after he met with coal miners and industry employees. don't forget, you can watch this event and many on bloomberg. this is bloomberg. ♪

vonnie: this is "bloomberg markets." i'm vonnie quinn. shery: i'm shery ahn. time for the options insight with julie hyman. julie: thank you, and joining me insight,"s "options out in chicago at the cboe. dan, great to see you as always. we have been talking about the unusually low volatility. we have a little bit of a decline in stocks today, a little bit of increased volatility. but it doesn't seem like it is coming back anytime soon.

i'm curious what you are seeing today. dan: we saw a little bit of a selling, we saw markets down. when you look at the vix futures, the reaction is pretty significant for this move today, the down move. really because of the real-life volatility to market is not moving and options players are not willing to pay up for options until they see a significant move, probably a breakout of the consolidation pattern we have seen in the market for the past three weeks. kelly we talked to kevin earlier in the week about the potential for another august shock, or what you call august surprise. how do the conditions for that set up? dan: the conditions are very similar to last august. we don't have the news coming out of china this time around but there could be other things that could influence the structure moving forward,

something to catch the market offguard. when you see these start to manifest that is when the psychology kicks in. i know there is no psychology in the market that would indicate the market is going to do something significant. if we do see a break in the markets than that fear comes back into play because of what happened last august and that has a tendency to manifest itself over the course of a few days. i would say a break below 2150 on the s&p might see a pop in volatility of that point. trade turning to your from today, we've been watching the s&p and the nasdaq reach new highs. the dow is a new high as recently as july. the small-caps, though, have not been making their own new highs not on a record basis. ? at is going on here it sounds like from your trade you do think it is going to continue to lag. dan: i do. we have seen a nice running on the markets, particularly when , you areat the russell

seeing the 30% jump from below -- from the lows in february. it has gotten a bit ahead of itself at this point. it has not taken up the huge tries from last year it if you see a sentiment shifted in a couple months, i'm betting that we will at some point see weakness in the market. i think the russell is going to have a bigger reaction to the sentiment change. julie: what is your spread, then? you are looking at a put spread. dan: i am. putting that put spread on gives you some nice downside protection. break 120, in short order, down to 114 on any weakness and sentiment shift in the market. this offers a nice protective put spread. julie: getting back to the markets generally any small caps would wrap into this, we have been seeing very tight

correlation with oil and stocks earlier in the year. then it started to divert. -- diverge. now it is coming back today with oil leading stocks down. do you think that will be more of a risk factor heading into the rest of august all? dan: i do. that $40 a barrel mark psychologically is significant. if you see oil start to break through here some of the fears we saw earlier in the year with a correlation every similar with markets and we'll come back to come back into play. that will supersede the potential for further weakness on the economic cycle. ultimately that is potential. julie: got to leave it there. thank you so much, dan denning. [ hip hop beat throughout ] [ fans cheering ]

♪ olympics 2016, let me get you on my level. ♪ ♪ so you never miss a moment, ♪ ♪ miss a minute, miss a medal. ♪ why settle when you can have it all? ♪ ♪ soccer to wrestling. track and field to basketball. ♪ ♪ fencing to cycling. diving to balance beam. ♪ ♪ all you have to say is, ♪ "show me," and boom it's on the screen. ♪ ♪ from the bottom of the mat, ♪ ♪ to the couch where you at? ♪ ♪ "show me the latest medal count?" ♪ ♪ xfinity's where it's at. ♪ welcome to it all. comcast nbcuniversal is proud to bring you coverage of the rio olympic games. scarlet: from bloomberg world headquarters in midtown manhattan, you are watching "bloomberg markets." i'm scarlet fu. joe: i'm joe weisenthal.

matt: i'm matt miller. scarlet: mark crumpton has more than his room. progressiveiance of groups is pressuring hillary clinton to keep people connected to wall street out of the transition team and white house if she wins in november. the groups include moveon.org and democracy for america. they say it will demonstrate clinton is serious about her promises like opposing the transpacific partnership trade court heard tomorrow mrs. clinton will deliver a speech on the economy in michigan. it will be at 1:15 new york time and bloomberg will of course have live coverage. cnn reports the secret service has spoken to donald trump's campaign staff about comments some say were a threat to mrs. clinton. the remarks, made yesterday in north carolina, trump suggested gun owners could stop a clinton agenda. trump denies threatening violence and says he was referring to gun owners' political power. a former 82 new jersey governor chris christie texted to a

colleague that christie "flat out lied" during a news conference about the george washington bridge lane closings scandal, according to a newly released court document. he faces trial next month for allegedly helping to orchestrate the lane closures for political revenge. christie's office did not respond to a request for comment. isturkey, president erdogan turning up the heat on the nation's banks. he says if they don't lower mortgage rates he will consider it an act of treason. the market averages close to 14%. says the ratesan should be about 9%. espn says veteran reporter john saunders has died. the network did not give a cause of death. an aide of of canada come joined espn in 1986 and was one of networks most visible faces. john saunders was 61 years old. global this 24 hours a day,

powered by more than 2600 journalists and analysts in 120 countries. back to you. matt: markets close in 30 minutes. live to the nasdaq where abigail doolittle has all the action. going into the last half hour of trading we have the nasdaq clawing back just a little bit, down about .4%, well off the lows that we saw in the late morning of today's session. all of this, of course, after the nasdaq did put in a record closing high yesterday and a record all-time high. the biggest boost to the mastec going into the close is a company of stocks that many do not associate with nasdaq, but it is indeed nasdaq-listed stock, walgreens. shares are higher. it points to the index overall. a report yesterday saying that the walgreens and write a merger is likely to gain antitrust

approval so long as they put together a plan to the vest stores. our team did reach out to jonathan palmer, bloomberg intelligence analyst, who says the bloomberg antitrust expert agreed with this, as does the, that it will go through if there is a plan to the best the stores. however, jonathan palmer says the devil is in the details, that getting rid of 500 to 1000 stores will require quite a few buyers. matt: and kind of surprising stock boosting nasdaq the most? abigail: well, that was walgreens. drag is two more traditional mastec stocks. semi equipment makers. kla down the most in the end of november. research associates

acquisition of kaylee is facing regulatory hurdles and it is unlikely to go through life expected october 20 merger day. even though the street thinks this deal only does go through, deutsche bank says the fact that there is a lack of product overlap helps the idea that the merger between these committees will go through. matt: the biggest drag, though, is apple. abigail: the biggest drag is often apple. matt: apple, microsoft, intel. abigail: all tech. matt: thanks very much for that report. joe: shake shack sales are projected to rise 6% in the quarter, stark contrast to the rest of the industry overall. restaurant traffic is flowing from the strong start in 2016. according to data -- joining us from princeton is michael halen

of bloomberg intelligence. he covers restaurants, department stores, and food. michael, talk to us about the headwinds facing this industry. why are we starting to see a run up? theael the biggest thing is difference in the cost at home versus away from home. that is the most pressure the restaurants are seeing. there is significant for depletion. food manufacturers cut their prices were keep prices stable, whereas the restaurants are facing higher costs due to minimum wage increases. they are raising prices to present, 3% annually. -- 2%, 3% annually. is causing that gap the spread. -- as it spreads, people vote with their pocketbooks, stayed home, backing their lunch. scarlet: does that point to a recession? and analyst said this could be

the start of a serious decline in the economy overall. michael: the names i look at him consumer, they have some definite headwinds. there -- they may be more demographic than economic at this point. a big thing is baby boomers. baby boomers love casual dining restaurants like applebee's, chi li's, and places like that. there were big cohort shopping at the parents restrict we are seeing casual dining and apartment stores -- department store sales slow as a be boomers retire and live on fixed incomes. that will accelerate over the next two years. we don't think the headwinds will ease anytime soon. joe: if we look inside bloomberg, i have a chart of the year-over-year change in average hourly earnings for the leisure and hospitality industry. you can see this disaster clean restaurants what it includes a.

-- this is not a clean restaurants but it includes it. michael, you mentioned this is being offset somewhat by rude deflation -- food inflation. how much is the restaurant industry innocence being bailed out by food deflation, and how --h margin pressure with would they see if they weren't getting helped by that? michael: big time, no doubt about it. there is also pressure from changes in overtime laws. there is no doubt about it that that is a big help to them right now. the declines in sales and traffic may have been even worse in the first half of this year. if they didn't get the commodity cost deflation. scarlet: michael, put shake shack into all of this. make the narrative for us in terms of how shake shack fits in with this trend of people going out less and restaurants. michael: well, it is not so much

that it fits into that narrative. they're looking for a different cohort. it is very popular with younger generations, millenials, who view paying a computer server at -- paying a tip to server at chili's as a tax. they like the freedom to go out at their own leisure. also, it sells liquor come in booze.ells on top of all, they serve not the healthiest food, that is for sure, but food that is antibiotic and hormone-free. the younger generation separately view -- definitely view that as something more healthy than something you get at mcdonald's and wendy's. matt: let me ask you about the short trade on shake shack. andhave a great piece on bi

that the trade didn't work in the first quarter. shares were up 10% after earnings. 15, the shares dropped after each earnings report even if they beat wall street estimates. michael: yeah, it is interesting, because last year like you said in those quarters, the stock had a crazy valuation going into the quarter. over 100.tiple people were shorting into the report and the stock would come in afterwards, despite the fact that they beat earnings each quarter they have been in existence. that trade worked very well for shorts. last quarter did not work so well. rts spiked going into the number. they reported another good number and this time the stock did not go down. right now it is up almost 20%.

that has not scared off investors. investors are shorting it again. short interest is up 50% since last report. sets up for in addition situation. telle margins can consensus, this could set up for a short sweep. matt: excellent piece on bloomberg intelligence. catch all of michael's research on the terminal. getats, -- bi eats, you get straight to the restaurant coverage. scarlet: with almost $4 billion under management, his case next. this is bloomberg. ♪

scarlet: this is "bloomberg markets." i am scarlet fu. time for the biggest business stories in the news right now. a german company taken over by creditors to years ago is said to be planning an ipo with office property unit, according to a person familiar with the matter. ivg could raise more than a billion dollars. opec is signaling that weakness in global oil markets may last for some time. in its monthly report, the cartel says demand will taper off in the u.s. at the end of the summer driving season. plus, fuel inventories remain high. saudi arabia has told opec it pumped a record amount of oil last month. the saudi's say they are meeting and increase in internal demand.

bonus reductions on wall street may not be as bad as some traders anticipated, according to johnson associates, which pegs the kleins and 10-15% this year but back in may it had projected a drop of 15-20%. for bankers handling corporate deals, pay will drop between five and 15%, also more optimistic than estimates three months ago. that is your business flash update. i guess before the whole brexit thing turned out and you saw the pickup in trading, at least momentarily, for currencies and then that spilled over into the bond market. matt: it is still depressing could bonuses are going to get 10-15% for, for example, bond traders. ,e are looking at possibly 25% estimated by johnson associates. it is just not as bad. joe: also on top of several years of an oppressive --

scarlet: you still have the third and fourth quarter. everything's good pick up a. matt: anything could happen. joe: if we get the good volatility. matt: leaders have turned into laggards as stocks push to new highs with the defensive errors of the market showing weakness. could the dip be a buying opportunity? morgan creek capital management ceo and cio joined the bloomberg team this morning and he explained why he is staying defensive on u.s. equities. , gold bugs on utilities -- bonds, utilities, gold, a great trade. it will stay great for a while. the demand for bonds is unbelievable. that will push rates down. treasuries still have a positive yield. all these other rates are negative. i think that will go for a while. we're starting to see some interesting opportunities. things have been beaten up a lot.

>> what about rotation? we hear about that in things like consumer discretionary. more of a cyclical stock. michael: i don't know. we are actually quite short consumer discretionary. series of really bad reports. part of that is the amazon roadkill story, off-line to online. jd.com, very strong chinese e-commerce. is going toink it be dead for a while. the blur overextended come forward a lot of money on student loans and for the cards. lighthouse almost. that's like a house come almost did -- like a house come almost. >> goldman sachs has a chart that shows cyclicals starting to outperform before brexit. the white line was brexit, and we are starting to inch there. mark: cyclicals are great. the cyclical story is

interesting in that we came in the year and everyone that commodities were dead. king dollar, the dollar is going to be fantastic. the dollar has been terrible this year. really getting smacked around this morning. that is good for commodities. commodities have bounced hard since january and a lot of cyclical stocks should have been bankrupt. if you don't go bankrupt, the upside can be huge. freeport-mcmoran -- there have been some amazing stories. growthea that suddenly is going to pick up and that will be good for cyclicals, that this a little more dodgy. >> the mining story was the ugly story of 2016. when i get a note that says we're looking at deutsche bank and credit suisse and we are almost there, i want to know about it. why are you almost there? mark: my hero into business -- one of my heroes, i have lots of heroes -- george soros. soros' first lock him up the worse the situation becomes, the

greater the upside. it cannot get worse for european banks right now. if you get a little worse. great line -- bad things happen. really bad things down. everyone says--- really bad things don't. everyone says deutsche going out of business. it's not, it's just not. turn?t is the term?-- what are you looking to happen? mark: first you need to see the stock going down. that makes sense. people trying to catch falling knives out of the air lose their fingers. but the knife hit the -- let the knife hit the ground and stop moving and then taken up by the handle. it stops going down, the rate of change in the client has gotten better. what we really need to see is the cathartic blowout. i think that happened two days 50 when the euro stoxx

kicked them out. that to me means everyone will be forced to sell and we will get this cathartic blowout and the value buyers come in. alix: you buy equities? mark: the play has been on the debt. great investment this year. the point will be to buy the equity and not tomorrow, but sometime close. in terms of gold, i feel like we are hearing a lot of gold bugs, to the market. at what point does golden dawn offer you the kind of liquid the and return you could get from, say, deutsche bank? great point, but i don't think they are substitutes. you want to have a barbell. you want gold as a currency. the reason gold is doing well is not because of commodities. it is a currency. best currency out there right now. all the other currencies, you put them in the bank, they take some of your money away. we still have not a negative field. you have to have some of the

currency in the bank, so to speak, maybe the bank of your house. then when you want to do with equities move a little bit out into value. when something is loved and despised like it is right now -- you talk about value, no one wants to talk about gmo, venerable value shop in boston, everyone hates it, they are amazing. when something is loathed and despised, that is when you want to get in. -- ir the really intrepid get interested. greek banks? -- greek banksks have been terrible. we were early -- euphemism for "wrong." [laughter] but they have had a second restructuring and all the grexit talk is gone. looksgoing forward, it like the greek banks could be back to profitability by the end of the event that will be a positive.

they are trading it kind of silly valuations. it is a silly story. there is still a lot of challenges. unemployment and the like. john templeton had a great line. he says, people ask me, where is the best place to invest? that is the wrong question. ask me where is the most miserable. it is pretty darn miserable in greece right now so it is a place to maybe look at picking up value. let's by value. morganat was mark yusko, creek capital management ceo. scarlet: coming up, a chart showing how investors are making money in every single asset class. a sign of pain to come back up this is bloomberg. ♪

scarlet: this is "bloomberg markets." scarlet fu. we had 10 minutes away from the close of trading today so let's look at markets around the world

and asset classes. the question this summer is whether stocks are overvalued as an asset class and one sign it could be is to look at the 200-day moving average. that basically is the average closing price over the past year , because it is 200 trading days. tracks 77 country indexes and in one third of the index as we track, 75% of the members are trading about that average. it includes the u.s., hong kong, australia, indonesia. proportion ofst, members trading above these numbers is the highest in at least a year. by these consummate tricks, yeah. kee: i love that title, "lat wobegon effect," where everybody is above average. matt: i don't get that, because i don't listen to that show. is that on npr? joe: yes. matt: a year go tomorrow, the

chinese devalued the yuan and that brought global stocks tumbling down. yet against the dollar in white and s&p in blue. first arrow down is august 11, 2015. then there was the slow crumble at the end of the year, where everyone was freaked out. scarlet: you inverted it. matt: yes, of course, inverted. what i see here that is interesting is starting here, as joe showed us yesterday, the to fadelar continues but you see the s&p rising to these new highs we are worried about. is this? joe: no, if you want to go into my terminal -- if you look, this is actually the s&p 500 versus the one-month volatility of the yuan and derek tracks it. even though yuan has been

declining, volatility is fading. i have it flipped over as well. one other thing i'm looking at -- this speaks to what scarlet witch on earlier about everything going up -- basically all asset classes everywhere are going up. eurozone bonds, commodities, high-yield bonds, even u.k. bonds. this is a tough situation for portfolio managers that like to see different aspects of the portfolio hedging -- scarlet: not supposed to happen. joe: not everything is supposed to go up at the same time. scarlet: if it all goes of it is going to come down. that does it for "bloomberg markets. "" what'd you miss" and the market closes next. take a look at the averages. dow off by 44 points. this is bloomberg. ♪

♪ scarlet: we are moments away from the closing bell. scarlet: i am scarlet fu. matt: and i am matt miller.

♪ stocks closing lower, off record highs, the worst day for the s&p 500 in one week. joe: the question is "what'd you miss?" our guest explains the call for higher oil prices. joe: the latest qe efforts hit speed bumps. what it means for stimulus? matt: macy's gearing up for a leadership transition. we have the charts you can't miss ahead of earnings tomorrow. declining.s. stocks from record highs, at least the s&p and nasdaq. the biggest drop in one week for the s&p. we have not seen big moves. six out of 10 groups finishing lower, financials and